Accounting-GR-11-MEMO-P2__hlayiso.com_.pdf

Downloaded from hlayiso.com Accounting Grade 11-Memorandum NW/June 2019 PROVINCIAL ASSESSMENT GRADE 11 ACCOUNTING: PAPER 2 JUNE 2019: MEMORANDUM MARKS: 150 MARKING PRINCIPLES: 1. Penalties for foreign items are applied only if the candidate is not losing marks elsewhere in the question for that item (no penalty for misplaced item). No double penalty applied. 2. Penalties for placement or poor presentation (e.g. details) are applied only if the candidate is earning marks on the figures for that item. 3. Full marks for correct answer. If answer incorrect, mark the workings provided. 4. If a pre-adjustment figure is shown as a final figure, allocate the part-mark for the working for that figure (not the method mark for the answer). 5. Unless otherwise indicated, the positive or negative effect of any figure must be considered to award the mark. If no + or – sign or bracket is provided, assume that the figure is positive. 6. Where indicated, part-marks may be awarded to differentiate between differing qualities of answers from candidates. 7. Where penalties are applied, the marks for that section of the question cannot be a final negative. 8. Where method marks are awarded for operation, the marker must inspect the reasonableness of the answer and at least one part must be correct before awarding the mark. 9. In awarding method marks, ensure that candidates do not get full marks for any item that is incorrect at least in part. 10. Be aware of candidates who provide valid alternatives beyond the marking guideline. 11. Codes: f = foreign item; p = placement/presentation. This marking guideline consists of 11 pages. Demo NW/JUNE/ACCNG/ EMIS/6******* Page 1 of 11

Downloaded from hlayiso.com Accounting Grade 11-Memorandum NW/June 2019 QUESTION 1 COST ACCOUNTING - MANUFACTURING 1.1 Match the concepts 1.1.1 E  1.1.2 A  1.1.3 D  1.1.4 C  1.1.5 B  5 1.2 BACHUM BUILDERS 1.2.1 Calculate: Direct labour cost 5 x 1 840 x R45,60 = 419 520 * 385 x 5 x R68,40 = 131 670 * 551 190 – 4 marks 419 520  x 10% = 41 952 * (37 756,80 + 4 195,20) - both for 1 mark Total = 593 142 * *One part correct 7 GENERAL LEDGER OF BACHUM BUILDERS (a) RAW MATERIAL ACCOUNT 2018 23 500 2019 1 Balance b/d 28 Creditors control 8 600  Mar  Feb 2019 Creditors Work-in- 488 400 483 000 28 Feb control  progress acc.  14 230 34 530 Bank Balance c/d   526 130 One part correct 526 130  2019 1 Balance b/d 34 530 Mar 7 Demo NW/JUNE/ACCNG/ EMIS/6******* Page 2 of 11

Downloaded from hlayiso.com Accounting Grade 11-Memorandum NW/June 2019 (b) FACTORY OVERHEAD ACCOUNT Consumable 2019 stores / Factory 2019 Work-in-progress 447 28 21 914  28 Feb indirect Feb acc. 988* material Indirect labour 81 000 Rent expense 174 278 400 x 5/8 000 Water and 101 electricity 175 134 900 x .75 Insurance 31 46 800 x 2/3 200 Sundry 38 699  expenses 447 988 447 988 10 (c) WORK-IN-PROCESS STOCK ACCOUNT 20 201 Finished goods b/ 19 2 1 524 80 8 1 Balance 27 270  stock d Fe 8 0 Mar Balancing figure b 483 000 201 2 Direct material * c/ 9 Balance 26 600  8 cost See 1.2.1 d Feb (a) Direct labour 593 142* cost See 1.2.1 Factory 447 988* overhead See 1.2.1 cost (b) 1 551 1 551 one part correct 400 400 201 b/ 9 1 Balance 26 600 d Mar 7 Demo NW/JUNE/ACCNG/ EMIS/6******* Page 3 of 11

Downloaded from hlayiso.com Accounting Grade 11-Memorandum NW/June 2019 1.2.3 GROSS PROFIT CALCULATION see 1.2.2.3 Cost of sales : 40 026  + 1 524 800  – 45 744  = 1 519 082 * Sales (units) 210 + 8 000 – 240 = 7 970  x R250 = 1 992 500 * one part correct Gross profit : 1 992 500 – 1 519 082 = 473 418 * one part correct OR 2 marks 2 marks 1 marks 2 marks 1 work with 250 – 190,60 = 59,40 x 7 970 = 473 418 8 1.3 MABE MANUFACTURERS 1.3.1 (a) 12 480 x R7,00 = 87 360  (b) 374 400/12 480 = R30  4 1.3.2 Do a calculation to verify the break-even number of units for the financial year ended 30 June 2019 see 1.3.1 a 25 x 12 480 or (224 640 + 87 360) 312 000  One part correct in workings. = 12 000 R92,50 – (28 + 30 + 8,50) 66,50  4 1.3.3 Comment on the break-even point and the level of production for both years. Quote relevant figures in your comment. Valid comment  quoting figures  Comparing BEP to level of production – the business produced 12 480 units which is 480 units more than the BEP. Making low profit. Need to increase productivity to increase profits Or Compare production 2018 to 2019 – the business produced 680 units more than last year. Or BEP increased from 11 800 to 12 000 units. The business did not make a profit last year (broke even) but managed to increase the production levels this year. 4 Demo NW/JUNE/ACCNG/ EMIS/6******* Page 4 of 11

Downloaded from hlayiso.com Accounting Grade 11-Memorandum NW/June 2019 1.3.4 Provide a valid reason for the change in direct material cost per unit. Any valid reason  see to calculation (b)  Could be additional transport costs.  Shortage of stock from suppliers pushed the price up (supply and demand)  Wastage in the factory.  Poorly trained workers.  Stock theft.  Inflation  Injudicious buying (not comparing prices, looking for alternative suppliers, etc. care-free kind of buying) 2 1.3.5 Give ONE suggestion that the business can use to improve production and profitability. Quote figures.  Reduce costs – 20% increase in direct materials.  Control use of raw material. Train workers to be more efficient (25,00  30,00)  Look for cheaper suppliers, local to reduce transport costs. (25,00  30,00)  Provide incentives to workers to produce more – only 680 units more than last year and 480 more than the BEP. Workers increase is 9%.  Spend more money on advertising to improve sales – there was a decrease in selling and distribution costs from 8,90 to 8,50 per unit.  Only a 14% increase in price of desks – could use a bigger mark-up. (40% mark-up presently being used)  2 60 60 Demo NW/JUNE/ACCNG/ EMIS/6******* Page 5 of 11

Downloaded from hlayiso.com Accounting Grade 11-Memorandum NW/June 2019 QUESTION 2: 2.1 Write only the term next to the question number 2.1.1 Stale cheque 2.1.2 Debit order 2.1.3 Bank charges  2.1.4 Dishonoured cheque 2.1.5 Bank overdraft 5 2.1.2 Cash Receipts Journal – 30 November 2018 Sundry Accounts Day Details Bank Amount Details Total 174 890 174 890 T Tlou 4 400 4 400 Rent income BWK Hospice 550 550 Donation CJ Motors 2 360 2 360 Repairs 182 200 182 200 * Details and the amount must both be correct and correspond for candidates to earn a mark or marks, i.e. details and amounts must not be marked independently from one another. 7 Demo NW/JUNE/ACCNG/ EMIS/6******* Page 6 of 11

Downloaded from hlayiso.com Accounting Grade 11-Memorandum NW/June 2019 2.2.1 Cash Payments Journal – 30 November 2018 Sundry Accounts Day Details Bank Amount Details Total 124 760 124 760 Allsure Insurers 980 980 Insurance L Lebona 266 266 Debtors Control ABC Bank 1 494 843 Bank charges Can be split 651 Interest on overdraft Venter Stationers 545 545 Stationery CJ Motors 2 360 2 360 Repairs 130 405 130 405 * Details and the amount must both be correct and correspond for candidates to earn a mark or marks, i.e. details and amounts must not be marked independently from one another. 13 2.2.2 Dr Bank Cr 2018 Sundry accounts / 2017 NOV Total Receipts 182 200 OCT Balance 32 649 30 1 2018 Sundry account NOV Total Payments 130 405 30 Balance 19 146 182 200 182 200 2018 OCT Balance 19 146 1 5 Demo NW/JUNE/ACCNG/ EMIS/6******* Page 7 of 11

Downloaded from hlayiso.com Accounting Grade 11-Memorandum NW/June 2019 2.2.3 Bank Reconciliation Statement on 30 November 2018 Details Debit Credit Balance as per Bank Statement 23 014 Outstanding deposit 19 870 Debit erroneously credited deposit 5 800 Debit outstanding cheques: 3013 12 348 3102 3 230 3132 2 360 Debit balance as per Bank Account 19 146 Both totals 42 884  42 884 8 2.3.1 As the internal auditor, explain TWO concerns you have over Keneilwe’s duties Any TWO 2 marks    Lack of division of duties negatively affects internal control  Lindi is the only person dealing with invoicing and receipt of cash  Nobody is checking Lindi’s work For 1 mark:  Division of duties   Internal Control  6 Demo NW/JUNE/ACCNG/ EMIS/6******* Page 8 of 11

Downloaded from hlayiso.com Accounting Grade 11-Memorandum NW/June 2019 2.3.2 Identify TWO problems with the cash slip and give advices to solve them. PROBLEM WITH EVIDENCE ADVICE   Problem Evidence figures not Specific advice required based on required evidence Division of duties must not be mentioned twice Award 1 mark for an incomplete advice Theft / Fraud / Error / Internal Check that the total of cash slips control measures are lacking. agrees to the total of the cash Some of the cash slips (7 000) deposit slip. have not been deposited / The person receiving cash must recorded. not be the same person depositing it. Division of duties. Rolling of Cash / The deposit Cash collected must be deposited occurs much later after receipt of immediately cash (15 days). 8 50 50 QUESTION 3: 3.1 Dr Asset Disposal Account N6 Cr 2018 2018 Accumulated July 1 Vehicles 100 000 July 1 depreciation on vehicles 42 400  20000+16000+64 00 Creditors Control  55 000 Loss on sale of asset  2 600 100 000 100 000 10 Demo NW/JUNE/ACCNG/ EMIS/6******* Page 9 of 11

Downloaded from hlayiso.com Accounting Grade 11-Memorandum NW/June 2019 Land and 3.2 Fixed/Tangible Assets Vehicles Equipment Buildings Carrying value at the beginning of 400 000 224 000 60 000 the year Cost 400 000 300 000 80 000 Accumulated Depreciation (0) (76 000) (20 000) Movements Additions at cost  120 000  150 000  48 000 (57 600) Disposals at carrying value 0 See 3.1 Depreciation Vehicles 6 400 + 15 000+ 32 * ( 53 400) * ( 9 200) 000 Equipment (8 000 + 1 200 Carrying value at the end of the 520 000 263 000  98 800 year Cost 520 000 350 000 128 000 Accumulated Depreciation (0)  (87 000) *29 200 * - any figure 20 3.3 The Land and Buildings were revalued on 1 March 2015 and the market value is R700 000, the financial records of are reflecting R400 000.Which GAAP Principle is applicable? Historical Cost 1 Demo NW/JUNE/ACCNG/ EMIS/6******* Page 10 of 11

Downloaded from hlayiso.com Accounting Grade 11-Memorandum NW/June 2019 3.4 Identify ONE problem in relation to each branch, quoting figures to support the problem. In each case, offer Wilson Bafana advice on how to solve the problem. BRANCH COMMENT ADVICE There is 10 motor bikes Take regular stock and missing / stolen (57 – 47). compare it with the stock OR records. Naledi Loss of income of R180 000. OR Figures  OR Improve internal control and Comment install security cameras.  Loss on profit on R60 000 OR Advice  Annel must pay in the shortage. Kagisano Money stolen/not all the Control the deposit slips. money banked. Shortage of Figures  R400 000. OR Comment Division of duties. Not the  same person must receive and deposit the money. Advice  Not a lot of motor bikes is Must not pay the manager a sold. Only 125 of 425./ Sold fixed monthly salary. Let him Taung only 29% of the stock. work on a commission basis. Figures  OR OR Comment Her advertising is not The manager must revise the  effective. Use R20 000 more advertisement strategy. as Kagisano and R40 000 Advice  more as Naledi. OR Take stock to other branches. 09 40 40 TOTAL: 150 Demo NW/JUNE/ACCNG/ EMIS/6******* Page 11 of 11